Repayments: Beneficiaries kick as CBN begins recovery of COVID-19 intervention loans

*The Central Bank of Nigeria-owned NIRSAL Microfinance Bank reveals it has paid out about N503 billion to over 881,081 Nigerians and business operators to cushion the negative effects of the global pandemic, urging the beneficiaries to repay their loans, as ‘they were not given as grants’

Isola Moses | ConsumerConnect

The Central Bank of Nigeria (CBN) has said the loans are not free money, the banking sector regulator is set to intensify recovery of loans, which it earlier approved and granted some categories of Nigerian consumers to ameliorate the harsh socio-economic realities during the disruptive Coronavirus (COVID-19) pandemic in 2020.

ConsumerConnect reports  the CBN, March 2020, had introduced the N50 billion TCF to support households and Micro, Small and Medium-sized enterprises (MSMEs) that were particularly hit hard by COVID-19 pandemic at the time.

The loan initiative involved is the Targeted Credit Facilities (TCF) granted to some Nigerians years back to minimise the harsh impact of the disease on their households or businesses.

Complaints about CBN’s ‘manner’ of loan recovery

As the Bank moves to recover the money from the beneficiaries of the facility, some of them, however, have expressed concerns about the manner of loan recovery, agency report said.

Fatimah Alli, one of the beneficiaries, was quoted yo have said that the sudden attempt to recover her N500,000 COVID-19 loan had worsened her financial challenges.

Alli related her experience:

“I got a loan of N500,000 in 2020 to cushion the economic effect of COVID-19.

“But at that time, we were assured that we would not be required to repay the money.

“But recently, all the money in my bank account was removed by the CBN as part of the loan recovery drive.”

Abbas Sule, also a beneficiary of the TCF, complained about arbitrary loan deductions from his bank account.

Sule explained: “When I was granted the loan facility in 2020, the bank official that processed the release through NIRSAL Microfinance Bank (NMFB) got a commission of N50, 000, and I was paid N450,000.

“Now, they want me to repay N500,000, that is not fair.”

In spite of some beneficiaries’ complaints about the manner of loan recovery, NMFB recently reminded and called for the repayment of COVID-19 loans given to households and business operators across the country, report noted.

NIRSAL disbursed loans at 5 percent interest rate to beneficiaries

It is also noted that NIRSAL, an entity owned by CBN, disbursed the loans to beneficiaries at five percent interest rate with a moratorium period that lasts till February 28, 2021.

However, at the expiration of the moratorium in 2021, the interest rate of the facility was hiked to nine percent from March 1 of the year.

NMFB, in Its official Twitter handle reportedly addressed the loan beneficiaries and stated, “we have played our part. It is now your turn.”

The MFB revealed that it had given out loans worth N503 billion to more than 881,081 Nigerians and business operators to cushion the effects of the pandemic.

It, therefore, the beneficiaries to take steps to repay the loans, as they were not given as grants.

NIRSAL restated: “You are expected to visit the nearest NIRSAL branch to obtain a loan repayment schedule.

“You must ensure that your loan account is always funded.”

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